Using multiple department factory overhead rates instead of a single plantwide factory overhead rate

A) results in more accurate product costs
B) results in distorted product costs
C) is simpler and less expensive to compute than a plantwide rate
D) applies overhead costs to all departments equally

Factory Overhead Rates

Calculated rates used to allocate a factory's indirect costs to products being produced, aiding in determining total production costs.

Plantwide Rate

A single, uniform overhead absorption rate used throughout an entire factory or plant, applied to all units irrespective of the department in which the costs were incurred.

Product Costs

Expenses directly associated with the manufacture of a product, including materials, labor, and overhead.